Spotlight on economy: Retail may rebound while claims seen static

U.S. retail sales probably perked up in May because of stronger auto purchases and weekly jobless claims may have edged a bit higher, but neither report is likely to show a major shift in the U.S. economy.

Retail sales are forecast to rise 0.5% in May after a small 0.1% uptick in April, according to economists polled by MarketWatch. Auto dealers recovered from a disappointing April and sales shot back up to an annual rate of 15.3 million from 14.9 million.

Automakers sharply increased incentives for buyers, however, so revenue growth may not have kept pace with higher unit sales. Retail sales are expected to rise 0.3% excluding autos.

Weekly jobless claims, meanwhile, have settled in around a range of 350,000 or slightly less. The level of claims is consistent with a sharp decline in layoffs, a trend borne out by other data. Yet the report says little about the willingness of companies to hire more workers.

Both reports will be released by the government at 8:30 a.m. Eastern. Also at 8:30 a.m. Eastern, the import price index for May is expected to fall 0.2%, another sign that U.S. inflation remains under wraps.

Finally, business inventories are forecast to rise 0.3% in April. The Commerce Department will issue inventories at 10 a.m. Eastern.